Housing stats watch!

Housing stats watch!

Over the last few months I’ve been getting increasingly frustrated at the inaccurate statistics being used in the media on housing. Yes I know, that’s always the way, but in my view what worries me is the impact this has on people’s housing decisions.

As such I’ve set up ‘stats watch’ to highlight inaccurate or misleading information/headlines by the media/other organisations which should be, in my view, highlighted and ideally corrected.

Have you seen a stat you know and can prove is inaccurate or misleading? Then contact me

The report made several errors which included claiming a 17% deposit was ‘needed’ when in actual fact this is a figure which first time buyers can afford to currently put down on their first home, mostly thanks to help from family. However, they don’t have to, first time buyers only ‘need to’ put down a 5% deposit.

In the main it was the use of ‘average’ wages and ‘average house prices’ that meant the report didn’t reflect the reality of what first time buyers were paying today, let alone what they would need in the future.

Headline: Renting in London is more expensive than living in most European 4-star hotelsPaper: The Independent LinkReported by: Residential landlord’s association

What was the problem?Basically the Independent were comparing apples and pears and coming up with oranges! They overstated the average rent figure at £1,600, they took the average price of the hotel outside of seasonal and weekend rates at £55 a night and they didn’t factor in a kitchen and washing facilities being provided.

In reality, renting in London is substantially cheaper than a 4star hotel in Europe!

And if you look at the cost of staying for a night in a London hotel, then you’ll be lucky to get anything less than £100 a night, so all a pretty ridiculous and scaremongering tactic!

Headlin: More than a third of homes sold last year were in areas unaffordable for first-time buyersOrganisation: Post OfficeLinkReported by: Kate Faulkner/Propertychecklists.co.uk

The report suggests that 36% of homes in the UK which they claim is equivalent to 5.5 million properties “are now in areas where the average home is unaffordable for those looking to take their first steps on the property ladder”

The key issues are though, they compare average house prices over the last 20 years growing at 306% to first time buyer wages only growing by 159%. What they don’t mention though is the cost of servicing a mortgage during this period of time has dropped by at least a half if not a third due to falls in interest rates.

They also compare today’s affordability to 1995. That’s a bad idea because in 1995, we were in the middle of a recession with prices versus wages at an all-time low and the cost of servicing a mortgage (according to Nationwide’s FTB affordability index) was at an historical low of around 20% of income, when normally it would be around 30% - much as it actually is in today’s market. At other times in the 80s and 2000s, this climbed as high as 50%.